Car insurance fraud: what can the consequences be?
Carinsurance fraud means that you deliberately mislead your car insurer. For example, by claiming more car damage than you actually suffered. Or by staging a collision so that you receive compensation. Car insurance fraud can have serious consequences. We explain it here.
#Your car insurance cover is denied
If you commit insurance fraud, you run the risk of having your car insurance cover refused. The insurer will then not pay your claim. It may even be the case that the entire claim is denied, even though there is only a small piece of fraud. Suppose you have been hit by another car. When reporting the car damage, you decide to also claim a number of old dents that you never had done anything about. It seems relatively harmless, but if your car insurer discovers this, they may refuse to pay your entire claim. Then you are stuck with more costs than if you had not committed fraud.
# 2 Termination of your car insurance
Insurers take insurance fraud very seriously. They do not like to see someone who commits insurance fraud as a policyholder. That is why they almost always terminate a car insurance policy when insurance fraud has been established. Do you have other current insurance policies with the same insurance company? Then the insurer will assess whether they are going to terminate them as well. The reason for terminating your car insurance and any other insurance policies is because you have betrayed the trust of the insurer. The insurer can no longer be sure that you are complying with the agreed insurance rule and therefore almost always chooses to terminate all current insurances.
#3 Registration of personal data in insurer's fraud register
Does your car insurer terminate the insurance? Then the insurer will save your data in their internal register. Many people confuse this with a so-called 'black list'. However, a black list does not exist. They do register when and why they terminate an insurance. This is to warn their own organisation and to keep them alert. In this way, they ensure that you cannot take out insurance again as long as you are still registered as a fraudster. Internal registrations are not visible to other insurers
#4 Registration with CIS Foundation
Stichting CIS stands for Stichting Centraal Informatie Systeem. In their database, they keep all insurance details that are important to share with insurers. If it is proven that you have committed insurance fraud with your car, you will receive a CIS registration. Your car insurer will then put your personal details in the CIS database, together with the reason for your registration. Other insurers and agents can view these details. The purpose of the database is to make any risks manageable for insurers and to prevent fraud as much as possible.
With a CIS registration for fraud, it is often difficult to take out a new car insurance. An insurer always checks the CIS database before accepting an insurance application. This way, it is easy to see whether you are registered or not. With a CIS registration you can actually only go to the insurance company De Vereende. De Vereende specialises in insuring special risks. Because of their broad acceptance policy you can still take out insurance, even with a CIS registration.
#5 Reporting to the Insurance Crime Control Centre (CBV)
The CBV is a department within the Dutch Association of Insurers, dedicated to supporting insurers in tackling fraud and other forms of insurance crime. Insurance fraud can also affect your career. If you apply for a job within the insurance sector or at a financial institution, there is a good chance that the company will consult the CBV. If they see a report of insurance fraud, they may reject your application: it does not make a very good impression.
# 6 Financial implications
Of course, insurance fraud also has a number of financial consequences. Firstly, you pay a standard fine of €532. Secondly, the investigation costs will be recovered from you. An insurer has to be able to prove that there really is a case of insurance fraud. That is why they carry out an investigation when fraud is suspected. These investigation costs can sometimes mount up considerably, especially if an external investigation bureau or expert has to be hired in. Finally, taking out a new car insurance policy will be more expensive than usual. This means that you will pay more premium than usual. You also have to pay three months' premium in advance and you pay a deposit to De Vereende. De Vereende can use this deposit to settle outstanding premiums if you are late in paying.
#7 Reporting to the police
The last consequence is immediately the most serious one: the car insurance company can choose to report it to the police. In practice, however, this does not happen very often. Reporting a fraud to the police is a big step and is usually only done when the amount of fraud is very high or when there is an organised crime.
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